Models Flashcards
What is Mendelow’s Matrix?
Show’s how different key players should be treated depending on their level of power and level of interest.
Mendelow’s Matrix: High Power and Low Interest?
Keep satisfied.
Mendelow’s Matrix: High Power and High Interest?
Key player.
Mendelow’s Matrix: Low Power and High Interest?
Keep informed.
Mendelow’s Matrix: Low Power and Low Interest?
Minimal effort.
What are the 4 parts of Porter’s Diamond? (Source of competitive advantage for a country)
- Demand Conditions.
- Strategy, Structure and Rivalry.
- Factor Conditions.
- Related and Supporting Industries.
What is meant by Demand Conditions in Porter’s Diamond? (2)
- More demanding local customers=innovative firms.
2. Trend-setting local consumers=anticipate future global trends.
What is meant by Strategy, Structure and Rivalry in Porter’s Diamond? (2)
- Prevalent strategies and structures=advantages in particular industries.
- Strong domestic rivalry=efficient firms.
What is meant by Factor Conditions in Porter’s Diamond?
Supply side factors. (human/physical resources, capital, knowledge, infrastructure).
What is meant by Related and Supporting Industries in Porter’s Diamond? (2)
- Proximity of supply=reduced lead times and carriage costs.
- Proximity=knowledge sharing which=innovation.
What are Porter’s Five Forces? (Current position of an industry)
- Threat of New Entrants.
- Threat of Substitutes.
- Power of Suppliers.
- Power of Buyers.
- Competitive Rivalry.
What are Kay’s Core Competencies? (CSF)
- Competitive Architecture.
- Innovative Ability.
- Reputation.
When discussing Kay’s Core Competency of Competitive Architecture what does it refer to? (CSF)
Relationships within and around a business.
- Internal architecture.
- External architecture.
- Network architecture.
Explain internal architecture. (Kay’s Competitive Architecture) (CSF)
Relationships with the employees.
Explain external architecture. (Kay’s Competitive Architecture) (CSF)
Relationships with suppliers and customers.
Explain network architecture. (Kay’s Competitive Architecture) (CSF)
Relationships between collaborating firms.
When discussing Kay’s Core Competency of Innovative Ability what does it refer to? (CSF)
The ability to create and develop new ideas and products.
What are the 9Ms of a Resource Audit? (CSF)
- Machinery and Materials.
- Management and Management Information.
- Makeup and Markets.
- Methods and Money.
- Men/Women.
What are the 4 Support Activities in Porter’s Value Chain?
- Firm Infrastructure.
- Human Resources.
- Technology Development.
- Procurement.
What are the 5 Primary Activities in Porter’s Value Chain?
- Inbound Logistics.
- Operations.
- Outbound Logistics.
- Marketing and Sales.
- Service.
What are the 5 stages of a Product Life Cycle?
- Development
- Introduction.
- Growth.
- Maturity.
- Decline.
What are the two factors that decide the position of a product on the BCG Matrix?
Market Growth and Market Share.
BCG Matrix: High Growth and High Share?
Star.
BCG Matrix: High Growth and Low Share?
Question Mark.
BCG Matrix: Low Growth and High Share?
Cash Cow.
BCG Matrix: Low Growth and Low Share?
Dog.
Expand on what a Star is.
In the short term these require high capex to maintain market position but promise high returns in future. BUILD.
Expand on what a Question Mark is.
Either high capex to increase market share or end them.
Expand on what a Cash Cow is.
Stars become Cash Cows, little capex for high income. Use to finance stars.
Expand on what a Dog is.
May have once been cash cow, now reap little profit. Tend to be cash traps that tie up funds and provide poor ROI.
What are Porter’s 4 Generic Strategies?
- Cost Leadership.
- Cost Focus.
- Differentiation.
- Differentiation Focus.
What are the two factors that decide the position of a strategy in Ansoff’s Matrix?
New/Existing Market and New/Existing Product.
Ansoff’s Matrix: Existing Market and Existing Product?
Market Penetration-
Price cuts, effective marketing, small product improvements.
Ansoff’s Matrix: Existing Market and New Product?
Product Development-
R&D, acquire rights to make products, buy in and re-badge, joint developments.
Ansoff’s Matrix: New Market and Existing Product?
Market Development-
New customer segments, industrial vs consumer, new regions, foreign markets.
Ansoff’s Matrix: New Market and New Product?
Diversification- Related diversification (vertical integration) and unrelated diversification (conglomerate diversification)
Expand on what the Threat of New Entrants is in Porter’s Five Forces.
Depends on the barriers to entry:
Economies of scale, static markets, brand loyalty, investment requirements, switching costs, distribution channels, patents, raw material access.
Expand on what the Threat of New Substitutes is in Porter’s Five Forces.
E.g instead of going to an estate agent for a bigger house you might go to a builder and an architect.
Expand on what the Power of Suppliers depends on in Porter’s Five Forces.
Suppliers bargaining power depends on:
Number of suppliers, barriers to entry for new suppliers, diversity of suppliers customer base, importance of the supplied product, specialisation of product, switching cost.
Expand on what the Power of Buyers is in Porter’s Five Forces.
Customers bargaining power depends on:
Quantity customer buys, importance of product to customer, switching cost, specialisation of product, profitability of customer, ability to bypass/take over supplier, price awareness of customer/skill of purchasing staff, importance of product quality to customer.
Expand on what the Competitive Rivalry is in Porter’s Five Forces.
Intensity of competition depends on:
Rate of market growth, level of FC, cost of switching, economies of scale, uncertainty of rival’s actions, barriers to exit (long-term exit, redundancy pay, effect on group).
Expand on what the Machinery and Materials is in the Resource Audit.
- Age, condition, utilisation rate, value, replacement, technology.
- Source, suppliers, waste, new materials, cost, availability.
Expand on what the Management and Management Information is in the Resource Audit.
- Size, skills, loyalty, career progression, structure.
- Ability to generate and disseminate ideas, innovation, IT systems.
Expand on what the Makeup and Markets is in the Resource Audit.
- Culture and structure, patents, goodwill, brands.
- Products and customers.
Expand on what the Methods and Money is in the Resource Audit.
- How are activities carried out?
- Credit and turnover periods, cash surpluses/deficits, short/long term finance, gearing.
Expand on what the Men/Women is in the Resource Audit.
Number, skills, wage costs, proportion of total costs, efficiency, labour turnover, industrial relations.
Expand on what the Firm Infrastructure is in Porter’s Value Chain.
Planning, finance, quality control.
Expand on what the Human Resources is in Porter’s Value Chain.
Recruitment, training, developing and rewarding people.
Expand on what the Technology Department is in Porter’s Value Chain.
Product design, improving processes and/or resource utilisation
Expand on what the Procurment is in Porter’s Value Chain.
Acquiring the resource inputs into the primary activities.
Explain what the Introduction stage of the Product Life Cycle is.
New products are generally slow to take hold and are likely to make losses due to high output costs (no economies of scale, high promo expenses).
Explain what the Growth stage of the Product Life Cycle is.
If accepted, sales of the product will rise more sharply, making profit and reducing unit costs. Competitors may be drawn into the market.
Explain what the Maturity stage of the Product Life Cycle is.
Most companies in the market are in the mature stage, where growth is slower and profits are good. A successful product would experience his as the longest stage of its life.
Explain what the Decline stage of the Product Life Cycle is.
Eventually sales begin to decline, causing fierce competition between producers. Those that stay in the market seek to prolong the life by modifying or exploring new markets. Some firms keep on a declining product to support complementary products.
Explain Porter’s Generic Strategy of Cost Leadership.
Obtain cheaper materials, hire cheaper labour, achieve economies of scale, minimise overheads.
Explain Porter’s Generic Strategy of Cost Focus.
Market segmentation, operate in niche markets, focused marketing, operational efficiency.